Financial forecasting

Consider the following production-oriented project. The units produced will sell for $28/unit and can be produced at a variable cost of $20/unit. Fixed costs are $80,000. The purchase price for the project is $200,000, depreciable down to zero over a four-year life. The project has no salvage value. Ignore taxes, but use a 10% required return when evaluating this project.A.

Calculate the cash-flow break even quantityB. Calculate the financial Break-even quantitiy

Consider the following discrete probability distribution:X-2.5-1.500.252.25P(X)0.160.140.150.17C

a) What is the missing value, C?

b) What is E[X]? Your answer should be the final numeric value of E[X], and should not involve a letter. (You’ll need to solve for C and properly incorporate that value to get the answer to this question.) Round your answer to at least 3 decimal places.c)

What is Var[X]? Your answer should be the final numeric value of Var[X], and should not involve a letter. (You’ll need to solve for C and properly incorporate that value to get the answer to this question.) Round your answer to at least 3 decimal places.

Solution: